How to make working with big businesses more profitable
Having large businesses as clients can be great for a (relatively) small business. Not least because big business can give you a decent flow of regular work, can pay a good price and make a good 'testimonial' client.
But they can also be a pain in the derriere to deal with.
In fact, when you work out the hours you spend in the lead up to winning work with a big business – the negotiations on price and then the 'client care' once they are on board – suddenly that deal with the big business doesn't feel so profitable.
I've worked on both sides of the big business/small business fence and here are my top five tips for making the process of doing business with big business more profitable:
1. Understand who the big business decision-maker is
You can waste a lot of time (lots of meetings!) discussing your offering with people who aren't authorised to make a buying decision. In fact, you'll probably be palmed off to someone fairly junior who will make you feel good about your prospects. But beware –this person can't and won't make a decision to hire you.
Early in your relationship with the big business find out who the real decision-maker is and get meeting with them.
2. Give a time limit for the buying decision
Big businesses are terrible procrastinators. They don't want to say 'no' but they also don't want to say 'yes'; they like to keep you hanging on in there as an option. This works for them. 'Yet another' meeting makes barely a dent in their business, but for you it's a heap of time that could be better spent.
If you don't want to waste your time in a never-ending series of meetings, force the big business into making a decision. Give them a deadline. It's scary, yes, but better to know now that they don't want to buy from you than to find out in 12 months', and many meetings, time.
3. Have one main point of contact and make sure they are senior enough
Once you start working with a big business you can find yourself swamped with calls and emails from any number of big business employees. This can be tough and time consuming to manage. Your best bet is to ask the big business to have just one (oh alright, maybe two) points of contact with you. And make sure this person is senior enough – that way they won't trouble you with irrelevant stuff.
4. Invoice regularly
Big businesses like to receive their invoices regularly and in a timely fashion. If you save up your billings and present one big invoice at a random moment you might find your budget has been used up! You're also more likely to get questions about the amount of work you're doing and the price of the work. Let's be practical; small regular invoices slip through accounts below the radar and are rarely questioned.
5. Chase your cash
If you think that working with a big business will be good for cashflow you're mistaken. Generally big businesses are slow to pay and, would you believe it, they simply don't bother unless you chase them!
Big businesses make great clients, provided you're not afraid to manage them, and be a little bit bossy!
Julia Bickerstaff's expertise is in helping businesses grow profitably. She runs two businesses: Butterfly Coaching, a small advisory firm with a unique approach to assisting SMEs with profitable growth; and The Business Bakery, which helps kitchen table tycoons build their best businesses. Julia is the author of "How to Bake a Business" and was previously a partner at Deloitte. She is a chartered accountant and has a degree in economics from The London School of Economics (London University).